However, I have paid $1000's of dollars to go to Law School and spent countless hours researching the law to know what should not and what SHOULD go into these agreements.

I feel like if I were to approach her to buy it, I am not going to be able to treat it 100% business. 

After swinging for the fences for 2 years trying to wholesale despite the obvious handicap of my age I realized I would need to change my approach.

If it is negatively impacting other tenants than I would do something about it, if not it is really hard for me personally to approach a good paying tenant about something they are doing that is legal and not negatively impacting any other tenant.

.: not much, but we update them like it's a flip. that's our downfall and a sore subject. we hope it pays off with longer term tenants and better care of the properties.That is our approach as well - rehab like a flip. 

You're a "private lender" when you loan to someone you have had past dealings with, or they are approaching you based on a personal relationship, you make a loan to your neighbor or cousin. 

I am thinking of approaching the caretakers of the property now to try and wholesale it, flip it, or hold them as rentals if I can get them at the right price.

So, if you have no issue with paying higher interest rates, or has the ability to loan to your own LLC to purchase the properties, then LLCs or Series LLCs is the way to go.For now, I go with the 2nd best approach, which is to cover myself with Landlord and Umbrella policies. 

The homeowner approached the court to sell it because he was done with the entire process, so they ordered it to be auctioned.

This will help you decide how to approach the investing side.